How should payments in lieu of notice be taxed from April 2018?

From 6 April 2018 all payments in lieu of notice will be taxable, whether contractual or non-contractual. Income tax and class 1 national insurance contributions will be due on the amount of basic pay that an employee would have received if they had worked their notice in full.

What are the current tax rules on payments in lieu of notice?

Currently, if you have a contractual right to make a payment in lieu of notice (‘PILON’), that payment is subject to income tax and national insurance contributions (‘NICs’).

If you don’t have a contractual right to make a PILON (because there is neither an express term in the employment contract nor an established custom and practice of making a PILON), any payment made in respect of an employee’s notice entitlement is generally regarded as ‘damages for breach of contract’ and the first £30,000 can be paid tax-free and without deduction of NICs.

What tax rules will apply to payments in lieu of notice from April 2018?

From 6 April 2018, all payments in lieu of notice will be taxable. The principle is relatively straightforward but there is a complex statutory formula for calculating the sum that should be taxed, known as ‘post-employment notice pay’ (‘PENP’). PENP is, broadly, the salary the employee would have received during any unworked period of notice minus any contractual PILON. It is calculated by reference to:

  • Basic pay only (before any salary sacrifice), disregarding bonus, overtime, commission, benefits in kind etc.; and
  • How much statutory or contractual notice (whichever is longer) the employer is required to give to terminate the contract.

PENP is subject to income tax and NICs in full. The balance of the termination payment is eligible for the £30,000 tax exemption and full NICs exemption (provided it is an ex gratia payment).

Statutory redundancy payments are exempt from PENP calculations and qualify for the £30,000 tax exemption, provided they are genuinely paid on account of redundancy.

The new rules will apply only where employment terminates on or after 6 April 2018.

There may be significant tax implications for non-contractual PILONs made from April 2018. For example:

  • An employee’s employment is terminated without notice on 30 April 2018. The employee is paid £5,000 monthly (basic pay); has a 3 month notice period; and there is no contractual PILON. They receive £35,000 compensation on termination. This an ex gratia damages payment, not linked to any contractual terms such as bonus entitlement.
  • Under the current rules, the whole compensation payment qualifies for the £30,000 exemption. Income tax is due on the balance of £5,000.
  • Under the new rules, income tax and NICs (both employer and employee) are due on the PENP of £15,000. The balance of £20,000 qualifies for the £30,000 exemption.

And from April 2019?

Currently if a termination payment qualifies for the £30,000 exemption, tax is due on any excess over £30,000 but no NICs are payable. From April 2019, employer NICs will also be due on the balance over £30,000. With employer NICs currently at 13.8% this will significantly increase the cost of some termination payments.

In practice

All employers should be aware of the new rules and think about how they might impact on any termination negotiations. It seems that PENP will need to be calculated for each employee whose employment is terminating including those with contractual PILON clauses (although we are still waiting for guidance from HMRC).

Where there is currently no contractual PILON clause:

  • Making a PILON where the termination date is 6 April or later will potentially result in significantly increased costs for both employer and employee.
  • Consider whether to exit any employees prior to April 2018 to take advantage of the more favourable tax position.
  • Think about including PILONs in contracts going forward. Having a PILON clause allows a payment in lieu of notice to be made without being in breach of contract, thereby preserving any post-termination restrictions. There will no longer be any tax benefit in not including one.

Please get in touch with us if you would like to discuss the impact of the new tax rules on your termination arrangements.

More about Protected Conversations

An employment relationship can sometimes run its course necessitating a frank conversation with an employee. It may be in the best interests of both parties to bring the employment to an end by way of a settlement agreement.

Often, the best way to start that process is by having a protected conversation.

What is a protected conversation?

The law allows an employer and an employee to have an ‘off-the-record’ conversation in certain circumstances.

If you or your employee are proposing to end your employment on agreed terms, the conversation can be kept confidential. This means that what you say can’t be used as evidence in an unfair dismissal claim. Although there are some exceptions, generally the conversation is protected.

What are the exceptions?

Protected conversations cannot be held in situations where dismissals are automatically unfair, such as those involving health and safety matters or where the protection of the Public Interest Disclosure Act is invoked. Neither is protection afforded to breach of contract or discrimination claims. This can be a problem. An employer may not know what issues are going to be raised by an employee during a protected conversation so always take advice from an HR professional and research as much of the history about the employee beforehand as you can. Recognise that in some situations having a protected conversation many not be the best route to take.

What should you do if you want to have a protected conversation with an employee?

If you’re planning to have a protected conversation with your employee, make sure you prepare in advance. You need as much information as possible. You may find it helpful to ask/research questions like:

  • Why are you proposing to terminate the employment?
  • Has the employee got a history of anything that might be relevant – grievances, disputes, sickness absence etc
  • How much are you offering and how has that been calculated? (Any notice pay would be taxable)
  • Will you expect your employee to work their notice period?
  • Will you be offering a reference?
  • What is the alternative if you don’t agree to a settlement agreement? I.e. manage their performance under an internal procedure which may result in termination for poor performance and notice pay only OR investigate an alternative role in the company?

Your employee is not under any obligation to accept any proposed settlement agreement. In fact, the law doesn’t allow anyone to accept it until they have taken independent legal advice on it (paid for by the employer usually capped at £350 plus VAT)

Ask your employee to confirm (once they have thought about it) whether they would like you to confirm the proposal in writing. This could be a draft settlement agreement or simply a letter or email. This will help you to clarify what is being offered but always ensure that any subsequent correspondence has ‘without prejudice’ in the title or heading.

Can an employee initiate a protected conversation?

Although a protected conversation is usually initiated by the employer, an employee can also request one, provided that it is with a view to agreeing a settlement agreement.

If your employee states that they’re willing to have an off the record conversation, you can go ahead with a protected conversation if you are minded to agree a settlement with them to leave. Let them know that the details of the conversation should be kept confidential because it’s with a view to reaching a settlement agreement.  Make written notes of the conversation you have had.

At the meeting, you could propose a settlement agreement yourself or you could ask your employee to make a suggestion for you to consider.

Although the most important aspect of a settlement agreement is usually the financial amount, you should consider non-monetary aspects such as:

  • a detailed reference
  • career coach support (professional help with finding another job)
  • release from anything in your employment contract that restricts you after the end of your employment
  • paying for a training course

What happens next?

You should give a reasonable period of time for your employee to consider any proposed settlement agreement. ACAS recommends 10 days, although employers rarely give this long in practice.

GDPR (what you need to know) part 3

This article forms part of our GDPR series in which Amelore employment experts offer practical advice, ahead of the coming-into-force of the GPDR in May 2018.

The General Data Protection Regulation (the Regulation) represents the most significant shift in European data protection legislation since the Data Protection Directive (enacted in the UK through the Data Protection Act) of the late 1990’s. The Regulation presents a very significant challenge to all data-driven units of modern business, not least human resources (HR).

In this article, we explore the legal and practical challenges the Regulation’s requirements pose to HR.


The GDPR expands the scope of European data protection legislation in both subject matter and territorial application. For the first time data processors (parties who process personal information on behalf of a data controller) will find themselves required to meet direct regulatory obligations. In addition, the Regulation’s intended jurisdiction is no longer restricted to EU-based organisations. The Regulation brings in scope any organisation selling to or monitoring the behaviour of EU citizens. Like much European law, the extent to which the Regulation will see successful enforcement outside of the EU is a developing area.

From a HR perspective, these provisions raise significant considerations for global employers, and providers of virtual HR and HRIS products. For a multinational employer, detailed understanding of global data flows will become an increasingly key. This is especially critical where a centralised storage and database solution manages global (both EU and non-EU group company) HR data. Non-EU group companies, using a shared resource, may find themselves directly affected by the GDPR.

For outsourced HR and recruitment, and HR software providers, the Regulation is set to present a new legal burden. At present, suppliers have, as data processors, enjoyed liability limited only to contractual arrangements with data controllers. Under the Regulation such processors will be required to comply directly with GDPR and by extension, face direct liability (and the same fine thresholds as data controllers under certain circumstances).


Regulatory fines under the GDPR are set to increase well beyond the ICO’s current enforcement ceiling of £500,000, representing a fundamental shift in risk profile for UK organisations.

That said, the Regulation grants Data Protection Authorities significant discretion as to whether and the extent to which fines will be imposed on an organisation, in the event of a breach.

In addition, the fine parameters are set against a two tier system to account for the comparative seriousness of different breaches.

From a HR perspective, it is critical for organisations to consider whether existing policies and procedures lack GDPR compliance, especially where time limits may be a factor, e.g. in relation to breach notification (see below).

Privacy Notices

The Regulation mandates a host of required information, which a data controller must provide to an individual data subject at the point at which personal data is collected. Non-exhaustively, these include details of:

  • the legal basis upon which personal data will be processed;
  • how long personal data will be retained;
  • if, and the extent to which, personal data will be transferred overseas, and, in the event that personal data will be transferred outside of the EEA, the appropriate safeguards in place to protect that data; and
  • the mechanism by which an individual would make use of their data subject rights, including:
    • how to make a subject access request; and
    • how to request the deletion or rectification of personal data.

These mandatory requirements present employer challenges both in relation to the employee/employer relationship and in the context of job applicant data.

Employers must consider whether existing employee and applicant notices meet GDPR requirements and consider how clarity and accessibility of notices can be ensured.

Employee Rights

The Regulation significantly enhances the rights of data subjects, which will in turn present greater compliance obligations for employers.

Areas which face significant change include:

  • the information to be provided to data subjects, in response to a subject access request – we will address this is in detail later in the series.
  • the Regulation mandates a more detailed set of information be provided to a data subject, particularly in relation to the purpose and means by which personal data is processed.
  • data rectification rights(in circumstances in which data held about a data subject is inaccurate or incomplete) – in some respects rectification rights remain unchanged under the Regulation. However, data controllers will now face a mandatory obligation to notify other third parties in the event that data is amended in response to a data subject request. Employers should be prepared to notify any third parties to which employee data has been transferred and consider how they might implement procedures to action this obligation in practice; and
  • the right to be forgotten– this new right presents a potentially significant practical challenge for employers, particularly where employee personal data is backed-up in somewhat inaccessible or complex systems. Much like rectification rights, a data subject’s right to have their personal data deleted on request should prompt all employers to consider how this would be practically achieved.

Breach Notification

The Regulation introduces dramatically enhanced requirements in relation to breach notification.

In summary a data controller:

  • must notify the relevant DPA within 72 hours of becoming aware of a breach, unless it can provide justification for a delay; and
  • is required to notify data subjects affected by a breach directly, without undue delay, if the breach is likely to present a high risk to the individual’s rights and freedoms.
  • This is tempered by exceptions, such as where the personal data is encrypted. Under these limited circumstances, controllers may be spared the obligation to notify data subject directly.

For HR, this presents a two-fold challenge. Should a breach originate within HR itself, effective co-ordination between HR and an organisation’s legal and/or compliance teams is likely to prove critical (especially when considering the tight timeframe for response). In addition, should the breach affect employee data and require data subject notification, HR is likely to play a key management role. Ensuring compliance will likely require a complete review of internal policies and procedures, with a particular focus on efficient internal communications. Data processors are also required to report breaches to data controllers.

Employee Consent

A change HR is likely to feel very directly is in relation to the use of consent as grounds for processing employee personal data. Non–specific consents to processing are unlikely to be considered valid under the GDPR.

Practical steps to compliance

The following are likely to prove critical risk management steps:

  • comprehensive gap analysis and business wide data protection audits;
  • a full review of internal and external policies, procedures, templates and information notices;
  • consideration of consent alternatives; and
  • consideration of (potentially mandatory) data protection officer appointment, and instruction of external legal/ compliance support.

Our next article will look at how to conduct a gap analysis and a wider data protection audit.

Looking forwards

The GDPR clearly represents a significant compliance hurdle. Employer’s must therefore maintain an awareness of developments at a national level, especially in relation to equality, recruitment and health and safety provisions.

Employers should however take some comfort that some element of harmonisation between EU data protection law and the UK’s eventual domestic position will be desirable. Compliance with the GDPR’s requirements, will likely be the most efficient way for organisations to futureproof.


This document is for informational purposes only and does not constitute specific advice. It is recommended that specific professional advice is sought in relation to your situation and organisation before acting on any of the information given.

GDPR – Employee record keeping and beyond

In a series of blogs, Amelore begin to look at GDPR from a HR perspective to ensure employers are ready for the new requirements in respect of their employee data and beyond. This will form part of a continuous focus on this hot topic until May 2018 when GDPR goes live. We appreciate many companies may not yet of begun their GDPR journeys, so we will be offering advice and guidance in short blogs.  We will also help to signpost employers to useful information which extends beyond the processing of employee data.

GDPR is itself an extension of existing UK data protection laws. This new legislation builds on the Data Protection Act (DPA) which employers already need to adhere to. DPA principles cover areas such as ensuring employers keep accurate, secure information.

The ICO (Information Commission’s Office) are at the forefront of helping organisations understand this evolution of our data protection laws. They recently published GDPR Myths. This series of blogs helps to demystify the new regulations.

Data breach – what an employer needs to do?

In ICO’s latest blog they provide valuable advice and guidance on how employers need to respond if a data breach occurs. They report that some employers have expressed concern that any data breach needs to be reported and that huge fines will ensue. The ICO say this is not the case and that only breaches that are likely to risk people’s rights and freedoms will need to be reported.

The ICO also point out that fines will be proportionate and that companies who are open, honest and report without undue delay can avoid fines. It is expected that by now, larger organisations will already have appointed a Data Protection Officer (DPO). However, smaller organisations are also advised to consider who in their organisation is responsible for data. We would advise all organisations, no matter how small, to know who is responsible for data (again not just employee data) and who is responsible for reporting a breach should it occur. This starts to form a robust approach to data governance.

Employee data processing

Employee data processing will be a key focus for many organisations, however some employers may be worried about any potential changes to how they currently store their data.

All organisations will be storing employee records in some way, shape or form; so you are now advised to review these filing systems, including the security of the data you are processing in respect of employing people, to ensure robustness. We have already observed some organisations writing to their third-party data processers asking for evidence of their compliance.

Handlers of this data need to make sure they are processing data fairly and for legitimate purposes. Furthermore, if they are transferring it outside of the EEA there are specific safeguards in place.

For those employers wondering if the UK’s exit from the EU will affect GDPR the government has already confirmed it will not. However, please note that International companies operating across EU states will need to work out who their lead data protection supervisory board is.

Further still, forming a data protection working party or project team to audit what data is being processed is also advisable. Many companies are already helping organisations with data mapping and auditing. Amelore work closely with Mazars to provide a range of services for our clients.

In summary, the good news is that common sense does prevail and that the processing of data where it is necessary for the performance of a contract will be a valid reason for processing. If you have any queries or questions in relation to any of the points made please contact Amelore for further advice and guidance.

We will continue to focus on this topic as we approach next year tackling other aspects of the GDPR (link to first blog) in further detail; such as consent, the right to be forgotten, and subject access requests.


GDPR countdown – are you ready?

The new  General Data Protection Regulations (GDPR) come into place in May 2018, you need to start preparing now as time is fast running out.

Changes to the governance of data will have far-reaching consequences for businesses, GDPR will determine how your business does business, and particularly how it manages, protects and administers data in the future.

Europe has a plethora of different data protection regimes in each EU country. Organisations have to deal with many different sets of rules depending on where they setup their business and sell their products or services. The GDPR will harmonise data protection laws across the EU and will also apply to organisations across the world. Any company that processes personal data about EU citizens whether they reside in the EU or elsewhere in the world will need to abide by the GDPR.

European companies are still wrestling with how they are going to be compliant with the law in less than a year. Companies from other parts of the world may not have even heard of the GDPR, and therefore might not be aware of the possible impact upon them. As citizens from EU countries do business and exchange data with companies across the globe, the GDPR is something that international companies outside the EU need to be aware of and should be planning for. Failing to do this could seriously hinder their ability to market and sell their products and services in the EU.

Who needs to be GDPR compliant?

It is imperative that organisations that offer goods and services to EU citizens, and that subsequently process their personal data, are compliant with the GDPR. 

A global study by Veritas showed that businesses are worried that they will not be compliant by the May 2018 deadline. Research showed that 56 per cent of respondents in Singapore, 37 per cent in the US and more than 60 per cent in Japan and South Korea, are worried they will be unable to meet the May 2018 deadline for compliance.

More than 90 per cent of organisations in Singapore showed concern by the potential business disruption from GDPR. Around 20 per cent fear that their company may go out of business as a result.

These are alarming figures for foreign companies that do business in the EU.

The GDPR represents a shift across the world towards a culture of safeguarding personal data, especially considering the global reach of the legislation.

What you should already be considering

As the clock is ticking companies should be working towards compliance in a structured manner including:

  • rolling out GDPR awareness programmes across the business;
  • ensuring representation and input from all key business functions;
  • data mapping all personal data flows in and out of the organisation;
  • creating an information asset register; and
  • undertaking a gap analysis against the GDPR compliance requirements, including consent notices, privacy impact assessments and contractual arrangements with 3rd parties with whom personal data is shared.

These will form part of the building blocks to determining how much further work is required for the business to be compliant by Spring 2018. Many businesses will require significant changes to policies, procedures and working practices. Smaller businesses which collect process and store limited personal data may be less affected but may still need to make some changes to comply with the new legislation.

Clearly organisations that started to work towards GDPR compliance early on are ahead of the game and have a better appreciation of the level of effort that’s required to make some of the changes required to comply.













Zero hours contracts – not always a bad thing?

You may have heard a lot about ”zero hours contracts” in the last few months, be that in the mainstream media, the business press or even professional publications and Parliamentary questions. They have generally been portrayed as a “bad” thing, but is that really the case?

Certainly the TUC have raised concerns about how these contracts are being used by some businesses, where they believe that workers are being unfairly exploited and the employer is avoiding its obligations.  Typically this has tended to be in the retail and hospitality sectors where senior managers argue that tight cost margins and peaks and troughs in customer demand leave them with few other options.  Critics have said that the flexibility that this type of contract offers the employer, doesn’t necessarily give the same flexibility to the worker. Examples being cited include workers having to be available at short notice, even for anti-social working hours, and being deliberately penalised (by not being offered more work) if they turn down a shift.

For some workers these types of arrangements do cause them huge problems. Be it having an unreliable and unguaranteed income, or having little control when they work and trying to balance this with family commitments.  Certainly trying to combine several zero hours contracts to try and generate a reasonable income can be impossible.

However for others this causes less of a problem. This could be because they already have some other form of paid work that guarantees them an income and this helps to “top up” their earnings to a better level. It could be be that they are a student or are semi-retired and don’t want to actually work too many hours, aren’t solely dependent on this money to live and are happy to work “as and when”.

Perhaps it comes down to what type and level of income and what degree of certainty people need?  If you know that, as a student, for one week a year you will earn money by working as part of the Graduation Week team, then you can plan your life and finances accordingly. For the university or college they know that they have a cohort of people who are willing to work flexibly during Graduation Week and can ask them to work as and when needed. If both sides are clear on this and it’s a mutually satisfactory arrangement, where is the problem?

Interestingly the recently published Taylor Review makes some similar distinctions between the “bad” and “acceptable” types of Zero Hours contracts. Certainly the recommendation about allowing people the right to request defined, regular hours (albeit it after 12 months) has to be a good thing. Equally the recommendation that those on  Zero Hours contracts should receive at least a higher rate of the National Minimum Wage to compensate for the uncertainty of their work, has merit too. Whether companies choose to do anything about this is another matter….

At the moment the recommendations from the review are just that – recommendations. We wait to see if the government decides to do anything about them and “encourage” employers to adopt them. Watch this space.




Can you keep a secret? How about your staff?

It’s not just American presidents who can be indiscrete and share potentially sensitive information with people they shouldn’t. While recollections of exactly what was said at that meeting by Donald Trump vary, there was definitely the potential for inappropriate information sharing, even if it was dressed up as politics or diplomacy.

Now unless you work in the Security Services, the Military or are a senior Civil servant, it’s unlikely that you and your staff will be in possession of such top secret information. However that doesn’t mean that the information your staff know and / or have access to is safe and risk free.  While they might not be the next Edward Snowden or Chelsea Manning, information is a valuable commodity.

There are companies and people out there who will pay money for information and aren’t always too​ scrupulous about where it comes from. While some things such as bank details or credit card information have an obvious financial value (when misused), other personal details can be useful and valuable to “scammers”, criminals​ or even marketing and advertising companies too.  This personal information could be about your customers but not always; it could be about your staff too.

As well as personal data, there will be other information that could be useful and valuable to others. It could be information from your customer database, it could be product information or technical data, your business strategy or your research programme – the list goes on.

So why would others getting this information be a problem you might ask? If you work in a competitive, commercial industry it could potentially give your competitors a helping hand to outperform you or compete more effectively against you. You’ve worked hard to build up your customer base and you wouldn’t want them suddenly buying from your competitors instead. It might help them undercut you on price or to negotiate better deals with your suppliers than you have. All is fair in love, war and business?

As for personal data, especially the type that is “sensitive”, you and your organisation have a legal obligation to store, manage and use it in line with current legislation. (The Data Protection Act 1998) If you are found to have breached the legislation, either accidentally or deliberately, the Information Commissioner can issue a penalty notice or a fine of up to £500,000.  You also need to be mindful that the Data Protection Act is about to be updated and there will be new obligations and regulations that come into effect in 2018. While you might be compliant now, you might not be by next year.

So what can you do about this potential information minefield? While it’s great to hear that you trust your staff that isn’t enough, or certainly isn’t as far as the Information Commissioner is concerned. Here are some suggestions of what you might wish to put in place:

  • A data protection policy and guidance and a contractual clause about the employee’s duties and obligations.
  • The relevant processes and procedures that support your data protection policy are vital too.
  • An appropriately worded confidentiality clause – either as part of staff contracts of employment or as a stand alone document.
  • An appropriately worded intellectual property clause would be useful for your staff working in research and development, or any other product development area.
  • IT guidance about file sharing, downloads and uploads, emails and social media can remind staff to think about what they share and send, and how they do it.

(This isn’t an exhaustive list but hopefully gives some food for thought.)

Depending how much of a risk you potentially face, you need to put the appropriate measures in place now before a problem arises. Once the problem or data breach occurs it’s too late…. You can’t undo what’s been said / saved / sent however much you want to and however much you try to rewrite history. (Politicians take note!)

Keeping your staff healthy – mind as well as body

Depending when you read this post, it is / was Mental Health Awareness week. This is a week focussed on improving mental health both in the workplace and at home.  You’ll no doubt be already aware of the statistic that 1 in 4 people will have some sort of mental health issue or condition during their lifetime – but the question for you as an employer and a line manager is what you can do to help?

People will often avoid talking openly about mental health because perhaps they worry about the reaction they might get when they talk about their illness or in the case of being a line manager are scared of causing upset or offence.  But talking honestly and openly is one of many ways managers and employers can help their staff.  You don’t have to be a trained counsellor to do this – listening and empathy is key and there are lots of resources out there to help you. (the MIND website is particularly helpful.)

You may also want to promote mental wellbeing to your staff to help them realise that there are some simple things that they can do to keep themselves well.  One of the mental health awareness campaigns that is currently being promoted is called the 5 ways to wellbeing.  These key ways or things are:

  • Connect
  • Be active
  • Take notice / be mindful
  • Keep learning
  • Give

And you can read more details of them at 5 ways to wellbeing

When you look at these in more detail, all of them are easily achievable in any workplace be it big or small.  It is a matter of how you engage and encourage staff to take steps to keep themselves as mentally fit and well as they can.  It could be by promoting activities such as a skills swap, holding a “bake off” or volunteering in your local community.

There are some excellent resources out there to help you too.  You may want to visit the MIND website or that of the Business Disability Forum?

Or if you truly want to put wellbeing – both physical and mental – at the heart of your business why not talk to us about developing a wider health and wellbeing strategy that is tailor made for your business.



Health, Safety and Wellbeing – is it possible on a tight budget?

Small and growing businesses need to keep a tight hold on their budgets if they are to get through those first critical months and years.  One cost that is sometimes forgotten or overlooked is for ensuring that your employees and workers are kept safe, healthy and well at work.  If you have more than five people working for you, you need to ensure that you comply with all of the current Health and Safety regulations.

That sounds daunting and potentially expensive, but it doesn’t have to be. Now I’d never advocate cutting corners on health and safety to help with the cash flow, but there are ways and means to help your finances.  You could spend a considerable sum, and there may be some unscrupulous people out there who will scare you in to thinking that you have to; but that really doesn’t have to be the case.

Often the Health and Safety essentials needed by law aren’t as complicated as they sound, so you don’t need to be an absolute expert to put them in place and monitor them.   The Health and Safety Executive (HSE) have a lot of free, helpful guidance available online and your own industry association / federation may also provide free or reasonably priced guidance too.  Essentially it will boil down to how complex and dangerous your workplace is – after all, there is a big difference between working in a small office and a nuclear power station.

Some aspects of health and safety might not cost you anything apart from staff time, as long as you already have the basic skills and knowledge in place. Examples can include ensuring that you have the required welfare facilities (eg. a toilet, wash hand basin and drinking water – hopefully things you already have?), that risk assessments and safe working procedures are in place, that staff take rest breaks and staff know what to do in the event of fire / accident / incident.  If you don’t have someone with the necessary knowledge in place already (known as a “responsible person”) you may need to get someone trained or you could buy in the expertise to get you set up.

Other aspects of health and safety will cost you some money, but these could be modest amounts and will certainly be a lot cheaper than doing nothing, only for an accident to occur later.  Examples here could include providing Personal Protective Equipment (PPE) – such as warning or hazard signs, “high viz” wear, steel toe capped boots, gloves or safety goggles / glasses – having a basic workplace first aid kit and fire extinguishers.  As with most things in life, shopping around and comparing quality and prices is key, as it would be very easy to spend a lot of money when you really don’t always have to.

Health and Wellbeing is a growing area and has the potential to cost you nothing or an awful lot.  Keeping your employees healthy and well doesn’t have to involve expensive gym facilities or memberships.  Sometimes the most simple things can reap the biggest benefits.  Recent research has shown that employees who take even just a 15 minute lunchbreak and spend it having a short walk outside are happier, healthier and more productive than those who don’t.  That doesn’t cost you, the employer, a thing – especially bearing in mind that staff typically aren’t paid for their lunchbreaks.

The most successful and effective health and wellbeing initiatives are often simple yet still manage to catch the interest of staff.  I’ve worked in organisations where groups and activities, such as a running group or a meditation session, are run by passionate volunteers who are keen to involve their colleagues. Group activities and interaction can really help staff morale and wellbeing even if they aren’t necessarily “active”. A popular workplace choir in one of my former workplaces springs to mind…..

So even if you are feeling the pinch financially, I hope that you do recognise there is still a need to keep your staff safe, healthy and well.  It doesn’t have to cost a lot and I can guarantee that even by doing a little, it will help save you a lot more money in the long term.

Time for a lunchtime walk anyone?

Happy New Financial Year 2017

Are you prepared for the new financial year which starts next week?  I’m sure that you’ve been busy planning your budgets and other financial plans too, so here are a few reminders of what you will need to include if you employ people.

  • National Minimum Wage increases – from 1 April 2017

This applies to employees and workers aged from 16 to 24 years of age. The new rates are:

Apprentices £3.50 per hour (+10p)
Under 18 years £4.05 per hour (+5p)
18 up to 21 years £5.60 per hour (+5p)
21 up to 25 years £7.05 per hour (+10p)
  • National Living Wage increased – from 1 April 2017

This applies to employees and workers aged from 25 years and above.  The new is £7.50 per hour, an increase of 30p.

  • Increases in pay for shared parental leave and other related payments – from 2 April 2017

This includes shared parental leave, statutory maternity pay (SMP), statutory paternity pay (SPP) and adoption leave.  The new rate is £140.98 per week, an increase of £1.40 per week.

  • Increase in statutory sick pay – from 6 April 2017

The new rate for statutory sick pay is £89.35 per week, an increase of 90p per week.

  • Increase in statutory redundancy pay – from 6 April 2017

A week’s statutory pay for redundancy purposes increases to £489, an increase of £10 per week.  This means that the maximum amount that can be paid for statutory redundancy will increase to £14,670. (an increase of £300)

  • Increase in the maximum award for Unfair Dismissal – from 6 April 2017

This will be used for claims with a termination date after 6 April 2017.  Claims may well be raised in April, May or even June 2017 but if employment ended before 6 April 2017 the old maximum award will apply (£78,962).  The new maximum award will be capped at £80,541.

  • Apprentice levy – from 6 April 2017

This should come as no surprise, but if your payroll exceeds £3 million then you will have 0.5% of the total payroll cost to go towards the new Apprentice Levy.

  • Gender pay reporting reference period begins – from 5 April 2017

Again this shouldn’t be a surprise and you have already planned to report on your pay data if you employ more than 250 staff.  Your first report must be published in April 2018 and include all of your pay data dating back to 5 April 2017.

  • Immigration Skills Charge – from 6 April 2017

If you employ staff on Tier 2 Skilled Worker visas you will be subject to a new “Skills Charge” of £1,000 for each new visa issued or for each visa renewal.  If you are a small business (SME) or charity this charge will be reduced to £364 per new visa / renewal.

Hopefully none of these have come as a surprise for you and your budgets cover these.  Also be aware that there are more changes planned to employment legislation over the coming year, so watch this space for more information and updates.